The Central Bank of Nigeria, CBN, has issued a fresh directive to banks as regards customers who lost money to fraudsters through the mobile money-driven Unstructured Supplementary Service Data (USSD) banking.
The CBN in its new directive has ordered banks to reimburse such customers who lost their money to fraudsters.
The USSD Banking platform which was introduced some months ago allows customers to transfer money to third party accounts, purchase airtime, open accounts and pay bills all using their mobile phones.
However, the USSD Banking platform is plagued with a low level of customer protection and security.
Speaking on the new directive the CBN Director, Banking and Payments Department, ‘Dipo Fatokun, said the CBN has reviewed the details of the mobile banking platform and has suggested incorporating the use of Personal Identification Number (PIN) to replace the last four digits on individual Automated Teller Machine (ATM) cards which was earlier put in place.
He said: “Banks are yet to perfect the security around the USSD transaction plan. They are not providing additional security, such as allowing PIN into the transaction process as against the current practice whereby customers rely on the last four digits of their ATM cards for transactions.
“This has resulted in many customers losing their money to fraudsters or people who have access to their ATM cards.”
The CBN Director, Banking and Payments Department also stressed that until banks are able to beef up security with the use of OTP or token to customers transacting through the USSD platform, they will continue to bear the risk of any loss of funds through the process.
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